The verdict in three sentences
When an operator advertises 1.7% commission, the merchant hears "I lose 1.7%" — that is wrong. In 2026, you must add the cash-out fees to get your money in cash, the bank settlement to transfer to your account, and the VAT on the commission, which brings the real bite to about 2.8%. Direct consequence: below a 3,500 FCFA basket, a sale can cost you more than it earns.
Advertised rate vs real cost
Operators communicate a "clean" rate that only covers collection. The real cost is built by stacking every friction between the moment the customer pays and the moment the money is available in your bank account, net of tax.
| Cost item | MTN MoMo 2026 | Moov Money 2026 |
|---|---|---|
| Merchant collection commission | 1.7% | 1.5% |
| Cash-out fee (cash withdrawal) | 1.0% | 1.0% |
| Bank settlement (account transfer) | 0.5% | 0.5% |
| VAT on commission (18%) | ~0.3% | ~0.27% |
| Estimated total real cost | ~3.5% | ~3.3% |
Depending on usage, not all items apply: a merchant who keeps their balance in mobile money and pays suppliers directly from the wallet avoids cash-out and part of the settlement. The average bite observed over a full collect-withdraw-transfer cycle sits around 2.8%.
The break-even point per basket
The smaller the basket, the heavier the fixed fees and percentage weigh against your margin. Here is the order of magnitude of the payment cost and net margin for various baskets, assuming a 25% gross margin.
| Basket | Payment cost (2.8%) | Gross margin (25%) | Net margin |
|---|---|---|---|
| 1,500 FCFA | 42 FCFA | 375 FCFA | 333 FCFA |
| 2,500 FCFA | 70 FCFA | 625 FCFA | 555 FCFA |
| 3,500 FCFA | 98 FCFA | 875 FCFA | 777 FCFA |
| 5,000 FCFA | 140 FCFA | 1,250 FCFA | 1,110 FCFA |
| 10,000 FCFA | 280 FCFA | 2,500 FCFA | 2,220 FCFA |
If you add logistics costs and a share of unsold goods, the real break-even point often climbs to around 3,500 FCFA: below that, it is better to group orders or set a minimum basket.
Mini case study
Kofi runs an online grocery in Lome with an average basket of 2,800 FCFA and 1,200 orders per month, i.e. 3,360,000 FCFA collected. At 2.8% real cost, he pays 94,080 FCFA in fees per month — far more than the 57,120 FCFA he thought he paid counting only the advertised 1.7%. By imposing a minimum basket of 3,500 FCFA and keeping his balance on the wallet to pay suppliers, he brings his real cost to 2.1% and saves about 23,500 FCFA per month.
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FAQ
Is the rate advertised by MTN or Moov false?
No, it is accurate but partial: it only covers collection. The total cost includes cash-out, settlement and VAT, bringing the real bite to around 2.8% in 2026.
How do I concretely reduce my fees?
Keep your balance on the wallet to pay suppliers and salaries, avoid unnecessary cash withdrawals, and negotiate a merchant rate once you exceed a certain monthly volume.
Should I pass fees on to the customer?
It is risky below a 5,000 FCFA basket: the visible surcharge drives buyers away. Better to build the fees into the price and set a minimum basket.
Is the VAT on the commission recoverable?
If you are VAT-registered and keep proper accounts, the VAT on service fees can often be deducted. Check your exact regime with your accountant.
Can I be paid for bringing merchants to Kolonell?
Yes. Our referral program pays 12% on every e-commerce site signed thanks to you, plus 5% recurring on maintenance. Introduce three merchants and the math gets interesting.
Let's talk about your project. We model your real fees and optimise your mobile money collection. WhatsApp +221 77 596 93 33.
Mohamed Bah
Fondateur, Kolonell
Passionate about digital and entrepreneurship in Africa, Mohamed has been helping Sénégalese businesses with their digital transformation since 2020. Founder of Kolonell, he believes every SME deserves a professional and accessible online présence.
